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Employers are paying more money to employ workers even before getting onto pay, as extra regulations and charges hit companies in the pocket.

The cost of an average hourly wage for a company in the three months to July was up 1.2pc on the year.

By contrast non-wage costs increased much more quickly at 3.9pc, the Office for National Statistics said.

Those include sickness, maternity and paternity pay, national insurance contributions and pension contributions.

Economists believe this is one cause of weak pay growth.

“We’ve got autoenrolment in pensions, the apprenticeship levy, the national living wage. Employers are feeling the pain because they’ve got all of these extra costs, and this is on top of imported inflation if they’re importing things from abroad,” said Alan Clarke, economist at Scotiabank.

“This has squeezed out the common man in a way. You can't get a pay hike if your employer has got to pay for all of these other things.”

Since the year 2000 non-wage costs have almost doubled, rising by 99.1pc, the ONS said.

Over the same period wage costs have risen by 61.8pc.

Wage costs are the largest component of the expense of hiring workers, however, so overall costs of employment are up 66.3pc over the past 17 years.

Other factors are also affecting wage growth.

The Bank of England believes that a rise in the number of low-skilled – and so low-paid – workers may have pulled down the average wage, as has growth in relatively low paid industries.

As this shift in the structure of the workforce comes to an end, wages may pick up again.

“Empirical estimates by Bank staff suggested that these may have depressed annual growth of average weekly earnings by around 0.7 percentage points,” the Bank’s Monetary Policy Committee said in the minutes of this week’s meeting.

“That could also suggest upward pressure on measured growth of average wages as these effects unwound.”